International Public Sector Accounting
Standards Board (IPSASB)
Update on Activities
Mike Hathorn
Chair IPSASB
IFAC IPSASB
Overview
• Background
• IPSASB Strategic Themes
• Project Updates – Present and Future
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IFAC IPSASB
IPSASB
• Standing Board within IFAC
• Develops International Public Sector Accounting
Standards (IPSASs) – accrual and cash
• Supported by the Canadian Government and CICA, NZ
and Swiss Governments, World Bank, UN Group , ADB.
• Technical Director and 3 staff Toronto based, 1 New
York, 1 Melbourne and 1 UK
• Rolling secondment from Chinese Ministry of Finance
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IFAC IPSASB
IPSASB Process
• 18 Members (3 Public Members)
• Meets 3 times per year
• 4 day meetings which may include a regional seminar
and/or a consultative group meeting.
• Open to the public
• All materials publicly available – posted on internet
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IFAC IPSASB
Developing Standards
• Accrual based standards
• Convergence with IFRSs unless public sector specific
reason for departure – ‘Rules of the Road’
• Public sector specific standards
• Current hierarchy – where no IPSAS exists consider IASB
standards or national standards
• Task Force to review Cash-basis IPSAS
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IFAC IPSASB
Transparent “Due Process”
• Exposure drafts: at least 4 months for comment
• Analyses of submissions
• Sub Committees, Task Forces, Project Advisory Panels
(PAP)
• Consultative Group
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IFAC IPSASB
Available on the IPSASB Web Site:
• All IPSASs (26 accrual plus 1 cash basis)
– (including Spanish and French translations)
• All current Exposure Drafts and other publications
• IPSASB Updates on most recent IPSASB meetings
• IPSASB meeting papers (before each meeting)
• Project histories
FREE OF CHARGE AT: WWW.IFAC.ORG/PublicSector
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IFAC IPSASB
Strong Evidence of Progress
• UN System (28 bodies)
• OECD, NATO (21 bodies), EC, IFAC, INTERPOL
• Almost 70 countries have agreed processes or have a
project in place to adopt IPSASs or align with IPSASs
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IFAC IPSASB
Disclosures by recipients of external
assistance
• Aims to harmonize/reduce compliance costs
• Requested by OECD/multi-laterals/bi-laterals
• Approved at Beijing meeting and incorporated into cash
basis IPSAS in early 2008
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IFAC IPSASB
Strategic Themes
• Conceptual framework for public sector
• Public sector specific issues including convergence with
statistical bases where appropriate
• IFRS convergence – ‘Rules of the Road’
• Promotion & communication
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IFAC IPSASB
Conceptual Framework
• Group 1 Consultative Document topics to be considered
in March 2008 as one document – Objectives, Reporting
Entity, Scope and Qualitative Characteristics
• Final review June 2008
• Group 2 topics to be considered in June 2008.
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IFAC IPSASB
Social Benefits : Current Approach
• ED 34: Disclosure of Cash Transfers to Individuals or
Households
– requires disclosure of amounts expected to be
transferred to eligible individuals or households (not
recognition and measurement)
– ED 34 approved in principle at Beijing meeting
• Consultation Paper on “Social Benefits: Key Issues in
Recognition and Measurement”
– approved in late February
• Initiation of project on long-term fiscal sustainability
– project brief will be made publicly available
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IFAC IPSASB
Service Concessions
IFRIC 12: Service Concession Arrangements issued: November 2006
• Operators only not grantors so limited direct applicability in public
sector
• Based on control
IPSASB Project:
Sub Committee supported by US GASB Staff
• Not constrained by existing accounting guidance/approaches
• Consultation Paper: for approval in March 2008
• Possible accounting approaches:
• Control
• Risks and rewards
• Reversion of asset
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IFAC IPSASB
IFRS Convergence
• Convergence strategy to update to IASB Standards as at
December 2008 by December 2009
• IPSAS 25, “Employee Benefits”
• IPSAS 26, “Impairment of Cash-Generating Assets”
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IFAC IPSASB
Rules of the Road: Purpose (1)
• Codify when divergence from IFRS is appropriate
• Clear statement of how IPSASB decides whether to depart
from IFRS and when to initiate public sector specific
project
• Approved at Beijing meeting
• Test during 2008 before going on website
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IFAC IPSASB
Rules of the Road : Key Steps(2)
• Step One: Are there public sector issues that warrant
departure?
• Step Two: Are the departures so significant that a public
sector specific project should be initiated?
• Step Three: Modify IASB documents.
• Step Four: Issue IPSAS
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IFAC IPSASB
Other IFRS Convergence Topics
Financial Instruments
• Update IPSAS 15 on presentation to converge with IAS 32
• Develop IPSAS on disclosure based on IFRS 7
• Issues Paper to be considered at March 2008 meeting
• Aim to issue ED later in 2008
Foreign Exchange
• Update IPSAS 4 (ED 33 released July 2007)
Borrowing Costs
• Update IPSAS 5
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IFAC IPSASB
Topics in work plan for 2008 and 2009
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Entity combinations
Intangible assets
Financial instruments – recognition and measurement
Fair Value
Management’s Discussion & Analysis (MD&A)/Narrative
Reporting
• Performance Reporting
Further consideration of work plan at March 2008 meeting
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International Federation of Accountants
www.ifac.org